* EU, IMF and ECB want 2 billion-euro budget hole closed
* Greek government rejects more austerity measures
* Athens says it still expects visit next week
* IMF says staff to resume work on Tuesday
By Martin Santa and Jan Strupczewski
BRUSSELS, Oct 31 International inspectors are
set to put on hold a trip to Athens because they have been
unable to bridge differences with Greece over how to close a 2
billion-euro ($2.7 billion) hole in its 2014 budget, euro zone
Athens, however, denied there had been any changes to the
inspectors' scheduled return early next week, and a spokeswoman
for the International Monetary Fund said that staff from the
global lender would resume work in Athens on Tuesday.
A team of officials from the IMF, the European Commission
and the European Central Bank - known as the Troika - visits
Athens regularly to check progress on its bailout commitments
and decide whether to release the next tranche of loans.
"There are growing differences between Athens and the
Troika," one euro zone official said, adding that the planned
trip was, for now, on ice. "The Greeks are saying, 'We are doing
enough', and the Troika says they need new steps to close the
Carlos Martin Ruiz de Gordejuela, the European Commission's
spokesman in Athens, said, "The Troika will be in a position to
resume the review mission in Athens once sufficient information
has been received from the Greek authorities to permit us to
hold meaningful policy discussions in person." He said if that
happened, a return in early November would be feasible.
The latest bailout inspection began in September before
being paused and was initially expected to resume in end-October
and then slated for resumption on Nov.4.
"They have asked for an appointment on Tuesday. What else
can I say?" Greek Finance Minister Yannis Stournaras told
reporters in Athens after meeting Prime Minister Antonis
Samaras. IMF spokeswoman Angela Gaviria said staff was set to
arrive in Athens on Monday and begin work the following day.
Greece has been kept afloat by a financial lifeline from the
euro zone and the International Monetary Fund since 2010, with
240 billion euros ($330.5 billion) of loans pledged in exchange
for spending cuts and reforms.
After a six-year recession that wiped out 40 percent of
household disposable incomes and sent unemployment soaring to
almost 28 percent, Greeks are saying they can take no more.
The coalition government argues it deserves some slack after
delivering the biggest budget deficit reduction ever recorded in
the euro zone. Greece's president said bluntly his country would
not yield to pressure from foreign lenders to impose more
"No one is going because no one wants them (the Troika)
there," a second euro zone official said.
MEASURE FOR MEASURE
Stournaras has rejected any new tax increases or
across-the-board wage or pension cuts, but said there was scope
instead for "targeted" spending cuts and "structural measures"
to plug any fiscal gaps.
Since the decision was made in mid-2012 by EU leaders, led
by Germany, that Greece must remain part of the euro zone, the
assumption has been that any disagreements will be solved.
"The Troika is talking about 2 billion euros. Greece is
talking about closing all of that through better control of
social security contributions. They say no more measures," a
senior euro zone official said.
"The solution is new measures. It will of course happen. It
is a matter of miscommunication to their own public."
The first euro zone official said there was still time to
sort things out because Greece would only really need the money
from the next tranche of loans in February.
According to one source close to the talks, the Troika has
yet to be convinced that Athens can deliver on a series of
reforms it had promised to implement by the end of September. It
needs to complete those "prior actions" to qualify for its next
scheduled bailout instalment of over 1 billion euros.
Greece and its lenders are particularly at odds over the
future of LARCO, Hellenic Vehicle Industry and Hellenic Defence
Systems, three loss-making state companies with 2,100 workers,
which cost taxpayers about 150 million euros a year.
The government has yet to prepare its two biggest water
companies, EYDAP and Thessaloniki Water, for
privatisation by settling all the arrears that municipalities
It must also convince lenders it will meet a target to put
12,500 civil servants in a "mobility scheme" of forced transfers
or dismissals and fire 4,000 others by the end of the year.
The target for Athens is a primary surplus of 1.6 percent of
gross domestic product for next year. The government believes it
could fall short by just 500 million euros, rather than the 2
billion predicted by the Troika.
The Greek parliament's budget office, whose role is largely
advisory and whose opinion is not binding, said in a report on
Thursday, "It remains open whether Greece next year will achieve
a 'primary budget surplus', such as the one agreed in the
medium-term bailout plan."
Greek authorities say a growing economy is the only way to
reduce the country's debt, which stands at about 320 billion
euros or 175 percent of its GDP. The Troika holds almost 80
percent of that debt.